Hi guys,
I’m struggling to find a way to structure a deal. Eg of a case: there are 2 options to pay: first is to pay upfront with high NPV (high cash) but if success the IRR is super, second is to pay small money upfront first then have various milestone payments later if success events happen. I’m not sure how to define the value of milestone payment here. Is it simply just the difference between NPV of success case and NPV of failure case? Any other issues to concern about?